Reports A model trade strategy: Digital trade
A model trade strategy: Digital trade
This briefing is part of a series “A model trade strategy for the UK”
Over six chapters, the series makes the case for the UK Government to publish a trade strategy which commits to trade policy which will support a transition to a fairer and greener world.
Digital trade: How can trade rules ensure the UK is able to regulate the digital economy now and in the future?
Data is the world’s most valuable resource, and the companies which capture and use that data are among the world’s most influential and profitable. An increasing proportion of goods and services are delivered digitally: in 2020, 25% of all global trade was digital trade.31 As digital goods and services
expand into all parts of the economy, technology firms are looking to trade rules as a means of cementing their dominance.
Digital trade rules, increasingly enshrined in FTAs and digital-only agreements around the world, seek to create a low-cost, low-regulation environment for
digital companies to operate. The digital economy carries huge potential -
to innovate, provide opportunity and provide consumers with convenience and value. However, it also brings inherent risks which are becoming increasingly prominent in the public consciousness, and to which governments are beginning to respond.
The US, for example, has in recent months overhauled its position on digital trade with a view to “balancing the right to regulate in the public interest and the need to address anti-competitive behaviour in the digital economy”.32 The UK might similarly wish to intervene in the digital economy for any number of
valid reasons, for example to guarantee the privacy of NHS patients’ data, to regulate the rapidly developing use of AI, or to curb the monopoly power
of giant corporations such as Amazon, Meta and Microsoft. Accordingly, the UK must ensure that the digital trade rules it promotes do not contradict or undermine such interventions.
UK trade digital trade